IBM - Palo Alto Networks: IBM Partnership Could Be A Game Changer In The AI Era

2024-05-24 00:10:52 ET

Summary

• Palo Alto Networks' Q3 earnings report showed strong performance, beating analyst estimates and raising revenue and EPS guidance for FY24.
• The partnership with IBM in the AI cybersecurity space is seen as a strong growth catalyst for PANW.
• The company's billings guidance, while lower than expected, is not a major concern as the progress made with platformization strategy and the underlying business remain strong.

Investment Thesis

Last time I talked about Palo Alto Networks ( PANW ), I discussed the company's Q2 performance and argued how the company's pivot to platformization is a smart decision for long-term growth. My rating on the stock was a Hold. Since my article was published in February 2024, the stock has gained 8.31%, handily outperforming the S&P 500, which gained 4.2% during the same period....

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